PRESIDENT-ELECT TRUMP IS IN FAVOR OF BLOCK GRANT MEDICAID

One of President-Elect Donald Trump’s signature campaign health care promises was repealing the Affordable Care Act, commonly known as Obamacare. But his election, coupled with Republican control of both the House and Senate, means that there will also almost certainly be a new GOP effort to turn the Medicaid program into a system of block grants to states. Under such a system, states would receive a lump sum of federal money to provide health care to low-income people, in contrast to the open-ended entitlement that Medicaid is today, with the federal government matching every dollar that each state spends. In March, as he was closing in on the GOP nomination, Trump unveiled a seven-point health care reform plan that included block granting Medicaid. His platform, which can be found on his campaign’s website, pledges to “maximize flexibility for states via block grants so that local leaders can design innovative Medicaid programs that will better serve their low-income citizens.”

Turning Medicaid into a block grant system was previously proposed in 1995 by then-House Speaker Newt Gingrich, then again in 2003 by President George W. Bush, and most recently in 2011 by House Republicans. Under the House Republican plan, states would have received a fixed amount every year, which would only increase with population growth and the overall cost of living. It would not be adjusted as a result of economic conditions. At the time, the Congressional Budget Office forecast that by 2022 federal funding for Medicaid would fall 35 percent below what the federal government was then providing states, and the shortfall would be 49 percent by 2030. States would be forced to make up for this dramatic loss in funding by restricting eligibility for Medicaid (including nursing home coverage), reducing covered services, and cutting already-low payment rates to health care providers.

“The House Republican budget proposal should be accompanied by a ‘Grandma Beware!’ sign,” said Ron Pollack, Executive Director of Families USA at the time. “The proposal will inevitably result in seniors losing the nursing home and other long-term care they need at a time when they are most frail.” Regarding the probable Trump effort to revive the block grant idea, InsideHealthPolicy writes that opponents contend that “state[s] would likely be allowed to cut benefits to deal with federal funding shortfalls or possibly even be absolved from the federal minimum requirements for beneficiary eligibility...” While 60 votes in the Senate would be needed to put a block grant bill up for a vote, Trump’s Secretary of Health and Human Services (HHS) could set up Medicaid block grant demonstrations in selected states. Candidates for HHS Secretary include Florida Governor Rick Scott, former pharmaceutical executive, Trump transition team leader Rich Bagger, and former House Speaker Newt Gingrich. Former presidential candidate Benjamin Carson, M.D. had been viewed as a leading candidate until last week when sources said he was not interested in a cabinet level position.

Of course, Team Fatoullah will keep you informed about upcoming changes regarding this issue and other Medicaid-related topics. Find them in The WELLNESS VILLAGE where they have been members since December 2011.